Merchandising Management
Final Test Solutions
Course Introduction
Merchandising Management explores the principles and practices involved in planning, developing, and presenting product lines within a retail environment. Students will learn about merchandising strategies, including product selection, pricing, inventory control, and visual presentation. The course emphasizes consumer behavior, market analysis, and the integration of technology in merchandising decisions to maximize profitability and customer satisfaction. Through case studies and practical projects, students gain insights into current trends and the skills necessary to succeed in the dynamic field of merchandising management.
Recommended Textbook
Retail Management A Strategic Approach 13th Edition by Barry R. Berman
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20 Chapters
2240 Verified Questions
2240 Flashcards
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Page 2
Chapter 1: An Introduction to Retailing
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112 Verified Questions
112 Flashcards
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Sample Questions
Q1) The functional orientation to the study of retailing stresses ________.
A) retail activities
B) retail planning
C) adaptation of retail strategy to match the retail environment
D) opportunities and constraints in decision making
Answer: A
Q2) An optical chain purchasing goods from dozens of vendors (these include frame companies,lens firms,sunglass manufacturers,and eyeglass case firms)demonstrates
A) a channel of distribution
B) economies of scale
C) vertical integration
D) the sorting process
Answer: D
Q3) Retail price competition is generally lowest in ________ distribution.
A) dual
B) exclusive
C) intensive
D) selective
Answer: B
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Chapter 2: Building and Sustaining Relationships in Retailing
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112 Verified Questions
112 Flashcards
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Sample Questions
Q1) Developing a description of a retailer's core customers is an important part of developing a target market strategy for a retailer.
A)True
B)False
Answer: True
Q2) The minimum value chain elements a given customer segment expects from a type of retailer is a(n)________.
A) proposed retail strategy
B) augmented retail strategy
C) expected retail strategy
D) potential retail strategy
Answer: C
Q3) Self-service merchandising makes the implementation of consumerism more difficult,especially with respect to the right of information.
A)True
B)False
Answer: True
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Page 4
Chapter 3: Strategic Planning in Retailing
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112 Verified Questions
112 Flashcards
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Sample Questions
Q1) Rigid operations' standards and a limitation on the product lines sold characterize
A) the owner-manager system
B) partnerships
C) franchising
D) chain ownership
Answer: C
Q2) Which retail strategy component is the most difficult to change?
A) promotion
B) pricing
C) merchandise management
D) store location
Answer: D
Q3) Buying an existing business allows a retailer to fully tailor a retail strategy to the owner's desires and strengths.
A)True
B)False
Answer: False
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Page 5
Chapter 4: Retail Institutions by Ownership
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112 Verified Questions
112 Flashcards
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Sample
Questions
Q1) In which of the following does a dealer receives assistance on site location,start-up practices,accounting systems,and management training in ________.
A) a leased department
B) business format franchising
C) independent channel ownership
D) a chain
Q2) Which form of retail institution most closely resembles a partially integrated system?
A) business format franchise
B) product/trademark franchise
C) retail chain
D) independent
Q3) A group of independent retailers seeks to establish a common identity and to generate increased bargaining power through centralized purchasing.Which of the following institutional arrangement should they consider?
A) independent vertical marketing system
B) fully integrated vertical marketing system
C) business format franchise
D) cooperative
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6
Chapter 5: Retail Institutions by Store-Based Strategy Mix
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112 Verified Questions
112 Flashcards
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Sample Questions
Q1) Relate the wheel of retailing,scrambled merchandising,and the retail life cycle concepts to one another.
Q2) Flea market operators can utilize the Web to supplement their traditional locations.
A)True
B)False
Q3) Develop a strategy for a small independent leather goods retailer to become a destination retailer.
Q4) Supermarkets have responded to the growth of the convenience store by being open for 24 hours and by installing express lanes for small purchases.
A)True
B)False
Q5) a.Identify the market characteristics of each stage of the retail life cycle. b.Identify appropriate retailer actions for each stage of the retail life cycle.
Q6) The use of prototype stores,second-use locations,and the buying of refurbished equipment are all an example of a cost-containment approach.
A)True
B)False
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Page 7
Chapter 6: Web, nonstore-Based, and Other Forms of Nontraditional Retailing
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112 Verified Questions
112 Flashcards
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Sample Questions
Q1) Why are direct selling and conventional vending machines not generally considered part of direct marketing?
Q2) The first step in developing a direct marketing strategy is ________.
A) generating customers
B) business definition
C) customer response
D) maintaining the database
Q3) Which of the following is a not a disadvantage to a catalog-based direct marketer?
A) the inability to pinpoint specific customer segments through mailing lists
B) the effect of increases in postal rates and paper stock costs on profits
C) high clutter due to the large number of catalogs that are mailed
D) the inability to revise prices when catalogs are prepared months in advance of distribution
Q4) Direct selling is not considered part of direct marketing since ________.
A) personal communication is used to initiate customer contact
B) no database is maintained
C) consumers do not interact with the firm
D) orders are not typically placed via mail or computer
Q5) Differentiate between the Internet and the World Wide Web.
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Chapter 7: Identifying and Understanding Consumers
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Sample Questions
Q1) A membership club has a differentiated marketing approach: final consumers and organizational consumers.
A)True
B)False
Q2) Recognition of shortage and recognition of unfulfilled desire are components of which stage of the consumer decision process?
A) information search
B) purchase behavior
C) problem awareness
D) evaluation of alternatives
Q3) The major difference between the family life cycle and the household life cycle is based on ________.
A) the size of the family
B) whether single-person households are included
C) whether nonfamily households are included
D) whether retired individuals are included
Q4) The information search process involves the use of only commercial sources.
A)True
B)False
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Chapter 8: Information Gathering and Processing in Retailing
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112 Verified Questions
112 Flashcards
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Sample Questions
Q1) The major distinction between primary and secondary data is that primary data are
A) less costly
B) generated by the affected retailer
C) generated specifically for the research project under study
D) conducted at continuous time intervals
Q2) In a simulation,the manipulation is done on a mathematical model.
A)True
B)False
Q3) The difference between regular reports and exception reports is based on
A) length
B) the handling of deviations from expected performance
C) cost
D) types of accounts covered
Q4) A frequent-shopper program is an example of ________.
A) electronic data interchange
B) market research
C) database management
D) data mining
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Chapter 9: Trading-Area Analysis
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112 Verified Questions
112 Flashcards
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Sample Questions
Q1) Differentiate among the three types of computer site selection models: analog,regression,and gravity.
Q2) a.Develop a statement describing an optimal economic base for a major ladies' clothing specialty store seeking an aggressive expansion strategy.
b.Is the study of an area's economic base still important when 15 percent of an area's population is tourists on vacation? Explain.
Q3) "A grouping of stores may actually increase the trading area for each store." This statement especially applies to ________.
A) convenience products
B) emergency products
C) impulse products
D) shopping products
Q4) The trading area with the highest average purchase by a customer is the ________.
A) primary trading area
B) parasite trading area
C) fringe trading area
D) secondary trading area
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Chapter 10: Site Selection
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Sample Questions
Q1) A power center is a form of regional shopping center.
A)True
B)False
Q2) Which type of shopping center is comprised of category killer stores?
A) power center
B) regional shopping center
C) megamall
D) string
Q3) Which business district is located in the part of a city or town with the greatest concentration of office buildings and retail stores?
A) string
B) central business district
C) neighborhood business district
D) secondary business district
Q4) Which unplanned business district is generally bounded by the intersection of two major streets?
A) isolated store
B) string
C) secondary business district
D) central business district
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Chapter 11: Retail Organization and Human Resource Management
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112 Verified Questions
112 Flashcards
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Sample Questions
Q1) The distinct needs of branch store customers are most recognized in which form of retail organization?
A) equal store
B) multiline retail organization
C) main store control organization
D) separate store
Q2) A retailer can determine which criteria are best correlated with job success through the use of a(n)________.
A) application blank
B) weighted application blank
C) goal-oriented job description
D) job analysis
Q3) a.Differentiate among the three styles of supervising retail employees.
b.Describe how each view of motivation could be implemented in human resource management.
Q4) A major disadvantage of extreme task specialization is ________.
A) poorly defined employee expectations
B) difficulty in hiring personnel with suitable training
C) high training costs
D) poor personnel morale
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Chapter 12: Operations Management: Financial Dimensions
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112 Verified Questions
112 Flashcards
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Sample Questions
Q1) Top-down budgeting reflects a style of supervising retail employees that assumes that employees lack ambition and dislike responsibility.
A)True
B)False
Q2) A retailer has $300,000 in cash,$500,000 in accounts receivable,$1,000,000 in inventories,$400,000 in marketable securities,and $2,000,000 in total current liabilities.What is its current ratio?
A) 0.15
B) 0.40
C) 1.100
D) 1.375
Q3) Which expense is normally not in a retailer's cash flow budget?
A) interest expense
B) employee fringe benefits
C) drawing account
D) opportunity costs
Q4) A firm's quick and current ratios are both measures of long-term debt levels.
A)True
B)False
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Chapter 13: Operations Management: Operational Dimensions
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112 Verified Questions
112 Flashcards
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Sample Questions
Q1) Which statement about energy management is not correct?
A) A retailer can reduce energy costs through adjusting a store's interior temperatures during nonselling hours.
B) The substitution of traditional bulbs with high-energy bulbs and fluorescent ballasts can significantly reduce energy costs for lighting.
C) The potential savings to a retailer with an effective energy management program are quite low.
D) Computerized systems with centralized controls that enable a retailer to control lighting, heat, and air-conditioning in each store from a single office can reduce heating, air-conditioning, and ventilating costs.
Q2) a.Develop a workload forecast for a photo studio shop with highly variable demand. b.How should the photo studio plan to staff its operation during weekend hours when workloads peak and personnel availability is low?
Q3) Micromerchandising is compatible with rationalized retailing.
A)True B)False
Q4) What are the advantages and disadvantages of rationalized retailing programs?
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Chapter 14: Developing Merchandise Plans
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112 Flashcards
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Sample Questions
Q1) The selling of car mats,burglar alarms,and extended warranties by a new car dealer illustrates ________.
A) scrambled merchandising
B) trading up
C) selling substitute goods and services
D) selling complementary goods and services
Q2) Which brands generally receive secondary shelf locations and receive little or no promotion support?
A) generic brands
B) manufacturer brands
C) dealer brands
D) scrambled merchandising
Q3) Distinctive,emulation,and economic emulation are three stages in the ________.
A) diffusion of innovation theory
B) fashion emulation theory
C) vertical trend theory
D) horizontal trend theory
Q4) Orders for staples are generally made using negotiated contracts.
A)True
B)False
Page 16
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Chapter 15: Implementing Merchandise Plans
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Sample Questions
Q1) The sale of floor-ready merchandise by a supplier increases the responsibilities of the supplier beyond just providing the merchandise.
A)True
B)False
Q2) A disadvantage to the use of frequent ordering in small quantities is the ________.
A) loss of quantity discounts
B) high investment costs
C) high insurance costs
D) high storage costs
Q3) Opportunistic buying generally relies upon negotiated contracts.
A)True
B)False
Q4) What are the pros and cons of direct store distribution from the perspective of the retailer?
Q5) An important source of information about consumer demand is the want book or want slip.
A)True
B)False
Q6) Develop a 10-item store security checklist aimed at reducing employee theft.
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Chapter 16: Financial Merchandise Management
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112 Verified Questions
112 Flashcards
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Sample Questions
Q1) A sales cushion is added to planned monthly sales in determining beginning-of-month planned inventory in the ________ method of inventory-level planning.
A) stock-to-sales
B) weeks' supply
C) percentage variation
D) basic stock
Q2) Merchandise available for sale equals ________.
A) sales less cost of goods sold
B) ending inventory less beginning inventory
C) cost of goods sold less ending inventory
D) beginning inventory plus purchases plus transportation charges
Q3) (Beginning inventory plus purchases)less (planned sales plus ending inventory)is equal to ________.
A) open-to-buy
B) planned reductions
C) the cost complement
D) markdowns
Q4) a.Describe the calculation of gross margin return on investment (GMROI).
b.How can a retailer increase its GMROI?
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Chapter 17: Pricing in Retailing
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Sample Questions
Q1) Price elasticity is ________ when the urgency for a purchase is low and the number of acceptable substitutes is high.
A) inelastic
B) elastic
C) unitary
D) positive
Q2) A market penetration strategy should be used when consumer price elasticity of demand is ________.
A) negative
B) inelastic
C) elastic
D) unitary
Q3) A jewelry store has been offered a special price on estate jewelry.A typical 14-karat pin costs the jeweler $350 and can retail at $595.What markup at retail will the jeweler obtain?
A) 20.0 percent
B) 36.4 percent
C) 41.2 percent
D) 57.1 percent
Q4) Explain how markup pricing can include a demand and a cost component.
Page 19
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Chapter 18: Establishing and Maintaining a Retail Image
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Sample Questions
Q1) A Starbucks coffee shop in a Barnes & Noble store best illustrates ________.
A) impulse sales
B) co-branding
C) experiential shopping
D) an ensemble display
Q2) The best retail locations are generally given to ________ goods.
A) profitable
B) convenience
C) complementary
D) specialty
Q3) Prototype store exteriors are commonly used by independents.
A)True
B)False
Q4) Atmosphere is based on a store's functional and psychological attributes.
A)True
B)False
Q5) a.Distinguish among selling space,merchandise space,personnel space,and customer space.
b.Describe how the allocation of these space components vary by low-end versus high-end retailers.
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Chapter 19: Promotional Strategy
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Sample Questions
Q1) Which characteristic of advertising as a retail medium is correct?
A) Media rates are generally higher for retailers than manufacturers.
B) Since a large number of media are available, retailers are generally able to match a medium to a target market.
C) A strength of advertising is its ability to tailor messages to specific target markets.
D) Advertising messages are generally long (in terms of time or space).
Q2) Any communication by a retailer that informs,persuades,and/or reminds the target market about any aspect of that firm is ________.
A) advertising
B) public relations
C) retail promotion
D) the retail communication channel
Q3) The canned sales presentation approach more closely fulfills the retailing concept than the need-satisfaction approach.
A)True
B)False
Q4) How can a retailer determine the effectiveness of its public relations program?
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Chapter 20: Integrating and Controlling the Retail Strategy
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Sample Questions
Q1) Which of the following is not a factor in the global retail development index (GRDI)?
A) existence of a large middle class
B) market attractiveness
C) time pressure
D) market saturation
Q2) A nondisguised audit is most appropriate in determining customer-service levels.
A)True
B)False
Q3) The use of a mystery shopper in assessing sales training involves a nondisguised audit while the store is open.
A)True
B)False
Q4) Discuss the relationship of the sales opportunity grid to slotting allowances and direct product profitability.
Q5) The study of "best practices" in retailing is an example of ________.
A) benchmarking
B) scenario analysis
C) gap analysis
D) variance analysis
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